HALIFAX - The small Mushuau Innu band of Natuashish, in Labrador, is up to $7 million in debt, and struggling to pay its employees. It's a situation the band was warned about long ago but did nothing to curtail, according to information obtained by the CBC.
Financial audits dating back to 2008 show out-of-control spending in the multiple millions by a community of around 800 people. Wages rose 60%, travel expenses and consultant fees doubled, and a $3-million bank loan taken out last year has disappeared, according to the CBC's report.
The band was in such abject shape due to poverty and problems with alcoholism and gas-sniffing that the federal government relocated it from Davis Inlet to the purpose-built Natuashish a decade ago.
But the band's woes continue.
Chief Simeon Tshakapesh, in a radio interview on VOCM in August, was unable to account for millions of dollars in revenue the band earns through the Voisey's Bay Trust and royalties from nickel mines, which amounted to nearly $7 million in 2008, $1.7 million in 2009 and a little more than $1 million in 2010.
Those revenues aren't used to operate the community, which is mostly paid for by the feds.
But Tshakapesh said the financial troubles began before he was chief and he "inherited a lot of mess."
He said 118 financial reports going back to 2005 were never filed, and he has been unable to obtain supporting documents despite repeated requests.
"The money was pouring in, and where did the money go?"
Auditors, reviewing unsustainable spending and failed business ventures, warned the band a year ago of the looming financial crisis, the CBC said.